0:00Thank you very much for joining us on the CEO moment.
0:02It's conversations with the world's most influential business leaders.
0:06You were one of the first people to say yes. So like hopefully the quality goes up from there.
0:10Good. Good. You got to start somewhere.
0:17Brian Chesy, welcome to the CEO moment.
0:20Thank you for having time at your headquarters in San Francisco. Airbnb is a company that will be celebrating its 20th anniversary next year. as a travel company, it's become a verb, right? We all know when we want to Airbnb something. So, I appreciate to hear your thoughts on where the company is today, where you are as a leader, and we're very happy to have you.
0:38Well, thank you for having me here today.
0:40How much time do you spend staying in an Airbnb?
0:43Almost every single trip I stay in Airbnb. I started staying a little bit hotels cuz we offer hotels and Airbnb. Um, but I'll be going to Amsterdam. I'm staying in an Airbnb, like a house on the canal. And, you know, I've booked hundreds of Airbnbs. So just about every Airbnb, every place I go, I try to stay in a home.
0:59How does that shape how you think about the company?
1:02Well, I always think a great philosophy is to make something that for yourself that you want. And essentially that's what I did. That's what I did when I started boo with my friends. And you know, I think dog fooding the pro product essentially is something that's really really important. We call it like being in the laboratory versus being in the field.
1:18Yeah. You really want to be in the field. You want to be, you know, in market testing the product, using the product. If I was in retail, I'd probably be visiting the stores often. I think it's very easy and very comfortable for a leader to be sitting back in their office just looking at the data. And I think the data only tells you so much. Data is often lagging indicators. And you often get the wrong lessons from data. And so you want to get firsthand experience. And that firsthand experience sometimes helps you make sense of data, but also tells you stuff that data can't really capture.
1:46Do you have an example of something you learned by staying in an Airbnb that you wouldn't have learned from the data?
1:52100%. It's very, very different to stay in a home that someone lives in versus a home that's a second home versus a home that is a dedicated rental managed by someone who connects via API. Generally, I prefer homes that people live in. At the same time, not everyone does. Some people don't like to see people's personal things around. Some people really want a slightly more hotel-like experience that's a little sparse or a little more little bit more standardized. And I think it's just good to remember there's about 10 million
2:21homes. And so I think people's associate Airbnb is based on the homes they search for. And so if you tend to book last minute in urban areas, you're going to have a certain type of aesthetic. If you book long lead time in Europe, you're going to have a very very different understanding. And so I think that like really understanding how different the experience of Airbnb can be. You know, you think about it like hotels are pretty much homogeneous. They're pretty much the same. Hotels don't vary that much between hotels kind of price point and then within the hotel the rooms are almost identical except for maybe the
2:50size of the room. Airbnbs are so disperate and so to understand the vastness in how unique everything is, you often need firsthand information.
2:59And so often times like just understanding even the trade-off between a home that's very easy to get into. A lot of people say I want to check and I'm not bothered versus some people say I want a cultural experience. I want the host to show me around. These are really, really nuanced things you have to experience. So, for me, being able to stay in these different homes, it really helps me understand the type of different properties. The other thing I've learned is how different it is by market.
3:22Now, if I'm going to go to Amsterdam, that's really different than going to Los Angeles versus going to say Boston or going to Austin. It's really, really different based on the market, based on the use case, and based on what the kind of guest is looking for. These things are really, really hard when you're an online travel company because we're not really asking people like what they're looking for. You know, on an online site like Airbnb, one of the challenge we have is we want to know as much as possible about you to make you happy. At the same time, people's attention spans are not really high. They're shopping quickly. Every question you ask is
3:51friction. So, it's difficult to ask a lot of questions.
3:54And forgive me, this is personal, but are you booking under your own name? Do people know that I book under my own name? I don't say I'm the CEO of Airbnb, but it's certainly not hidden. And if you read the reviews, they're going to figure it out pretty quickly. And I think 80% of people figure it out. You know, I always say like, should I go under pseudonym? I I want to not tell people I'm the founder of Airbnb and almost like ask for a special experience. I want to try to get a realistic experience. At the same time, I like one of our core things is we want real people to book their real homes under the real identity. And so if I'm going to force real identity
4:23to other people, I have to live by that self.
4:25So you think you're getting the same experience that other people are getting? I think I'm getting close to the same experience, maybe a slightly more positive than typical experience, but I can tell sometimes people have no idea who I am. And I always assume I'm getting the best case scenario.
4:38There aren't that many founders leading Fortune 500 companies. You were one of three who founded the company in 2007.
4:46How do you think the fact that you founded this company shapes how you lead it today?
4:51Being a founder is such a different type of experience and I could never figure out how to describe it. I literally went on like a circuit after the pandemic trying to explain how I run the company.
5:05I was going to say how you described it became kind of a a defining feature of how we think about leadership today.
5:10Yes. And Paul Graham wrote an essay and he called it founder mode. I didn't come up with that term. He did. I basically spoke in front of like 200 entrepreneurs. I described how as a founder you run a company different than a professional manager. And Paul Graham kind of realized in that moment that there were two different ways to run a company. The way a founder would and the way a professional manager would. And it's very very different. Now I'm making some generalizations. So the people that build companies that tend to be more in the details, more decisive, bigger authority uh to make decisions. They
5:40tend to take bigger bolder risk partly because they have the moral authority too. Like for example, I could I wouldn't but I could change the name of the company because I came up with the name of the company. Somebody who is a professional manager, I don't think they would ever dare change the name of the company. Um they would feel like it's not theirs to change. And that's the thing, it's ours to change. You know, we're not like a foster parent. We are the parent. Somebody once said, "Being a founder is the upper bound of how much anyone will care. No one will ever care about the company more than you." And so that passion is definitely higher. I
6:10also just think, you know, every single job in the company that someone does, I did before them and I did a much better job for the most part minus the specialization like accounting. I wasn't an accountant, but there was a day where we had to figure out like how to count our money and we were like, we got to go on QuickBooks. How does QuickBooks work?
6:28And we started doing it and at some point we got over ahead and we found a consulting CFO. And so every single job in the company, the generalized version of that job I did before I delegated that job. I also as a founder it's almost like I know the chemistry of company. I know the the melting point of the company. I know the freezing point of the company. I kind of know how much you can bend a company before something breaks and therefore how hard you can push people, how many changes you can make.
6:53And what would you say to someone who says that the the founder type is one of the reasons why things aren't working in society today? That people who have these bold founder visions wander into fields that they shouldn't be in and that's how we get into trouble. Well, there's always like for every like light there's a shadow and I think that founders [snorts] are the ones that I think probably make the biggest impact on business. Um, and then of course they are also some of the times the ones that have the fewest checks and balances. And so I think that the best case scenario
7:22in society is when a founder is able to scale and able to be successful. The primary weakness of me as a founder ran a company was people had to pay for my immaturity in my 30s and my lack of experience and they had to pay for my learning curve. But I said it was a good long-term bet because eventually I will become as mature as a professional manager. But a professional manager can never gain what I had. They can never do that unless they go through the process I went through. But as far as whether or
7:50not founders are being responsible in society, I think that's like a whole another topic. And ultimately, you know, I think of us as founders as leading by example. I'm not perfect. I try to lead with a reasonable amount of humility, but enough confidence to make big changes.
8:02Let's talk a little bit about how you run the company. You've said that you think CEOs think about hiring wrong. Why is that?
8:09Because I thought about hiring wrong, you know, and I'll tell you a a kind of quick story. When I was starting Airbnb, somebody um actually the person was Sam Alman who became a friend of mine. He said, "Hiring should be 50% of your job." I'm not even sure it was his 50% his job. and I said, "Yeah, I should do that." It never was 50% of my job. It wasn't even 10% of my job. And so, I never really spent enough time hiring and I never really made it a high enough priority. And what I've learned the hard way 19 years later is that it's all about the people. And it's kind of a
8:38cliche. You probably heard that over and over again. I don't think hardly anyone in business believes it's all about the people. Here's my evidence. If they all thought it was all about the people, then wouldn't the HR function be the most important function in a company?
8:51And you think in most companies it's not?
8:53No, I think it's primarily administrative function. And if it's so important, why is it administrative function? I probably spend three hours a day recruiting. I used to think it was my job to hire my management team and it was their job to hire their team. And if they can't hire their team, they're ineffective. What I do is I treat myself as the co-hiring manager for all my direct directs. We both have to agree to the person because when my exec retires, naturally, they'll be looking at their person under them as their successor. If it's their person, not your person, they may not be philosophically aligned with
9:23This doesn't create tension with the people who report to you.
9:26If that creates tension, then I'm going to tell them like, "Leave the company."
9:30If somebody needs quote authority to operate in a huge amount of space separate from me, then I tell them this is not the right company for you. I don't want to think of this as me in your business meddling. I want to think of it as if our relationship's good, we make each other better. Also, I really always want to teach people to reach for the stars as far as hiring. We It's almost like we're trying to marry up constantly. And the basic philosophy is we're not trying to hire for the company of today. We're trying to hire for the company of tomorrow. We want you to come here to build the company of tomorrow.
9:57Well, people can only evaluate us based on who we are today. So, somebody has to be there to sell the dream of who we're going to be tomorrow. And I think that person's the founder.
10:05You mentioned that this advice came from Sam Olman. Do you think he's spending half his time today on hiring?
10:10Ah, you have to ask him that. During the pre-launch of Chachi, he told me that's what he did. I think I learned the hard way that I didn't spend enough time in hiring and so I now think it's the number one priority inside of the company for me. There's another thing I remember once seeing an interview by Steve Jobs and he said great people don't need to be managed. Of course they do, but what he meant is great people don't need to be managed as much as people that aren't as great. And so if you spend more time hiring presumably you would spend less time having to manage. So you're going to spend time on people either way either on the front
10:40end or the back end. So what I think you should do if you're a CEO or a founder is constantly be meeting talent even before you need it. And also just wait until you find the right person even if it's a little bit painful because ultimately short-term pain is long-term gain.
10:55You mentioned Steve Jobs. He's someone you talk about frequently I think. What have you learned studying how he led his company?
11:01So a couple things about Steve. First of all I think of Steve as a designer that ran a technology company. And so therefore like is that how you think of yourself?
11:08I think of myself as a designer that runs a technology company. I'm not as good as Steve Jobs, so I don't want anyone thinking I compare myself to him, but I like a kid looking up to LeBron James saying I want to be like, you know, that's a good mentor, a role model to me. That's what I think. Um, so I studied him quite a lot because I almost felt like me coming to Silicon Valley was a bit of a glitch. A designer running a tech company. I couldn't code.
11:28People called me quote non-technical.
11:29And so it seemed kind of like Did that bother you?
11:32Um, a little bit. A little bit. And this this this goes to like a long history. I went to Renown School of Design. I was an artisan designer. And when I was at Risdy in the early 2000s, there was a whole thing, how do we get design in the boardroom? Designers, similar to people in HR, aren't typically empowered in companies. For example, most Fortune 500 companies, including the CEOs you're interviewing, I'm curious how many of them have a designer report to them. A lot of companies that should have a designer report to CEO, don't. Look at
12:02the board of the Fortune 500. How many creative people are on the board? Not a lot. But we're living in an age where creativity is going to really matter, especially in the age of AI. And so I thought why can't a designer instead of have a seat at the table, why can't they run the boardroom? And so that was kind of my thinking for like why to start a company. Anyways, I had the good fortune meeting Ed Catmull. Ed Catmill has the distinction of having worked with Steve Jobs longer than anyone else in their career continuously from 1985 to Steve's death in 2011. I asked Ed Catal a question. I said, "What was most misunderstood about Steve Jobs?" He said
12:32what was most munderstood about him was that he went through the hero's journey and that the book that Walter Isaac wrote was primarily a composite of the Steve before he got fired from Apple. At least the impression people got and that he went through the wilderness of 11 12 years at Next was commercially a failure 12 years later sold for $200 million by today's standards not a success but in those wilderness years really learned how to become a great CEO. came back 90 days from bankruptcy to Apple in 1997
13:01and somehow led the greatest turnaround in the history of capitalism. And how did he do it? It's a mystery that no one had an answer until you realize what he did at Nex. And what he did, I think he's learned how to be a good CEO. So the key lessons he had were he held people to extremely high standards. He spent a lot of time recruiting. He was in the details. You know, people called him a control freak. He probably was a control freak.
13:22Do people call you that?
13:23I think some people do. I think some people do. But I asked Johnny IV once. I said, "Do you feel like Steve was a micromanager? Was he a control freak?"
13:30And Johnny said, "No."
13:31Well, Johnny might be a control freak, too.
13:32He might be. And so if Johnny was a control freak, Steve Jobs couldn't have controlled him.
13:36Okay. Technically, so Johnny said to me, I never felt like Steve was micromanagement. I felt like we were constantly partnering cuz Steve wouldn't tell Johnny what to do. He'd just be visiting him every day for lunch, constantly working back and forth. And I think a last resort is a micromanagement where you're like telling people what to do. If I'm telling somebody what to do, they're probably not successful. So, the best thing is we're partnering. I'm asking you questions. What if we did this? What if we did that? Now, I'm not doing that my chief accounting officer.
14:04I'm not doing that with my like a tax attorney. I'm doing that in areas where I think it can add value like product, marketing, operations, things like that.
14:11That is what you've learned from Steve.
14:13We talked about hiring and how you think about that. I think another topic that you're vocal on is email. How do you think people use email wrong inside of companies? Well, I think they use email and that's maybe People should not be using email at all.
14:24How often do you use email?
14:26I don't know if I write an email a week.
14:28I respond to email. I respond to emails every day because people email me, but I'm trying to think of the last time I like drafted email. I don't know if I What do you have against email?
14:38I just find it like inferior to almost every other form of communication. So, email is subject based. Text message is person-based. Um, I think text message is much faster. It's contextual. You you feel like a deeper connection to the person. Doesn't have a subject line.
14:54When you get a text message, it doesn't feel like work to respond. When you get an email, it feels I wonder if you think that's a problem that people like you and other leaders and companies are using text as a form to communicate about work and it's overwhelming people. It's confusing the lines between work and life. Do you ever think about that?
15:11Yeah. And I And you disagree.
15:13Yeah. Because I think that everyone has a right to run their company how they want. And for me, the blending between work and life is like is more probably blended than the average person. I do think there's boundaries. Um, you know, I try not to text people when I think they're with their family unless there's a crisis. Um, but I do think that text is a lot more responsive than mail. Like the notifications pop up right on your phone. If I have a problem, my general philosophy try to call someone, text them, meet them in person. I think the best forms of communication are in
15:42person number one. Okay. Zoom number two, text number three, probably email number four. Um, and I say text, WhatsApp, these are all like Slack are all versions of like kind of like messaging.
15:53Yeah. You talk about being in person as kind of the best form of communication. You've also been been vocal about what type of workplaces work for people, remote work, hybrid work. I'm curious with a little bit of the distance from the pandemic if you're thinking about the value or lack of value for remote work has changed.
16:10I've evolved my thinking a little bit.
16:12Tell me about that. My soybe was like like every company and almost in the world we were like mostly entirely in person and we weren't even familiar with the product Zoom before the pandemic and we were using like WebEx and Skype and the technology really wasn't there. So it was always considered a secondass experience. Then the pandemic occurred and we were all on Zoom and Airb had a unique experience because we lost 80% of our business in eight weeks and so we not only turned the company around in Zoom, we actually went public on Zoom and the company was more successful on Zoom than the real world. Additionally,
16:41I started noticing that we were benefiting from this movement of people working remotely. And I thought we had to put our money where our mouth is. We had to support this idea that you can live and work anywhere. And I thought that was really, really great. What it did is allowed a lot more flexibility. I don't think 100% employees should be in an office 5 days a week. And I think the fact that you have an office inside of your laptop is a great thing that offers flexibility. And so I had this view that you'll be able live and work anywhere.
17:07be mostly remote and we could get together whenever we needed to. It turns out over the course of a few years and in hindsight it's kind of obvious to imagine that came at a cost of essentially the culture remains strong for a while but it's hard for new people to get to know other people. If everything's on Zoom everything has to be scheduled and sometimes things can just be like quick conversations. It's difficult to have development. Some types of creative work you want people standing around seeing pointing at different things. You want to build trust. You want people to
17:36understand who they're working with. So we have our version of hybrid. Most people when they say hybrid they mean like three four days a week. Our hybrid is more like a week or two a month and you know it depends on the job. And we found this is working pretty well and we're experimenting with having more and more people come and work in San Francisco. I think the general trend line is going back to more and more inerson connection but never losing the sense of flexibility. You know there's a couple things. Number one, if you impose everyone to be in San Francisco or
18:05wherever your office is, you have to make a very simple business calculation.
18:09Is the productivity and connection gain of requiring everyone be office better than the candidates you lose because you require people to live between 30 and 60 mile radius of the office? And you have to make that decision. [snorts] Here's another thought I have. This might be contrarian, but I have a view that like if your office policy is easy to explain, it might be wrong because it might be one sizefits-all. Everyone comes to work four days a week. That's easy to understand.
18:33But it might actually be that like different people in different departments have different conditions. Some people should be really in the field. Some people are creative. They should be really in the office together. Some people can both, you know, somebody who's doing like accounting and they don't need to do as much collaboration.
18:46Could totally remote.
18:47Another thing that you have thoughts on is uh regular one-on-one meetings with your direct reports.
18:52Not really doing them.
18:54Not recurring. You talked about the need for culture, understanding, trust. I think most people think that that meeting set every week can create those things between two people. You feel like it's unnecessary.
19:04I think it's not only unnecessary, it's probably inferior. And if you go through the list of great CEOs, almost none of them that I'm aware of do recurring one-on ones. And I'm kind of curious that the people you interview, they might do it, but most of the people I admire don't do it.
19:18Do you think that's a Silicon Valley thing?
19:19I don't know. It might be a Silicon Valley thing. I think it might be a founder thing. Okay. Um, I know like for example, Jensen Huang does not do recurring 101's famously. Let me clarify my position.
19:30I [snorts] do think a CEO should meet one-on-one with your people. I don't think it should be recurring, but I think you should meet oneonone. At the same time, I have all sorts of like if you want to get time me, there's an issue. Get a meeting with me. If you want to call me, call me. Bump into me, talk to me. But most of my recurring meetings are group meetings. I want my recurring meeting, my CFO and maybe their directs or crossf functional because what ends up happening is it's actually more connection because if you
19:57and I have a conversation that's private that's appropriate if this is truly a private sensitive topic.
20:03If there's lots of one-way kind of sensitive topics, there's probably something wrong in the company that we should be able to operate in more transparency meaning people aren't having the conversations that they need to have or they're afraid to have it and they're afraid to have it. And by the way, if you're having all these like sensitive conversations, well, why are they so sensitive? Why can't other people hear about them? Occasionally, you're going to have a a one-on-one with the attorney. They're attorney kind privilege. It's a very serious matter.
20:23Those are very, very rare that you ever have that. So, usually a group meeting is great. People present work and their directs and their peers can listen in.
20:33And if I have a one-on-one with you, you tell me there's a problem and we debate it and we say, "Here's the solution." We haven't consulted anyone else. So, now we just made a decision and no one else consulted or knew how we made that decision. and he didn't get anyone else's input. So this is why I think a recurring 101 is inferior. Now some great CEOs have been proponents. Andy Grove famously Steve Shaw's mentor was a proponent in high output management book of recurring 101. So I do want to acknowledge one of the greatest leaders of all time was a proponent of recurring
21:02101 ones. It is the classic management philosophy. In other words, there's a bunch of philosophies. Hire great people. Trust them. Let them do their job. Stay out of the details. Do recurring 101 ones. I don't believe in any of that. And I want to acknowledge that many great leaders do.
21:17I want to talk a little bit about the state of Airbnb today. I think the biggest change that's happened in the last 12 months is the the launch of an app that was intended to be kind of a do-it-all for travel. I'm curious how that's going and why you felt like this was the moment to create that new product.
21:31It was actually like the I think like the third attempt at it. So it was the moment because we finally we were ready to do it one more time and give it a shot. I never intended when I started Airbnb or at least within three years of Airbnb for Airbnb to only be one thing, a home for when you travel. And something remarkable happened. The category was way bigger than we imagined. We do nearly hundred billion dollars a year in bookings on primarily that category. It's a noun of urban culture. But in 2016, we first tried to like well actually it was earlier than
22:00that, but in 2016 we did a major launch of experiences and other things. And there's an old saying at Silicon Valley, there's no bad ideas, just ideas are too early. And I like that saying because it sounds counterintuitive, but usually it's like bad ideas come too late. I think we were too early. The organization was not ready to expand beyond his core business.
22:16It was too early for the company or was too early for the market?
22:19Both. I think it was too early for the company because we [snorts] were in hyperrowth. You know, Reed Hoffman, one of my first investors, said, "Starting a company is like jumping off the cliff and assembling the airplane the way down." And if you're send me the airplane the way down, you're probably not assembling it like permanently like the right way you're supposed to keep it in the air. You're keeping in the air and like here's another analogy.
22:38Imagine we're building a house and the house is built for like five people live in. So we're going to build a ranch house. So we're not going to like build this deep concrete foundation for one floor and then suddenly more people want to live in it. Now we need to turn a ranch house or a 10-story house.
22:50Suddenly you're like crap, I don't have the foundation to build more floors. You were growing so fast. You know, you might read about a little bit chaos at OpenAI or Enthropic today. There was chaos at Airbnb and Uber in other companies during hyperrowth era. A lot of the chaos is the intersection of young leaders and hyperrowth. They're learning something the first time. But more than that, it's actually the hyperrowth. Hyperrowth is inherently unstable. And anything that doubles in size every year is unstable. And some of these AI companies are doubling every quarter. When something is really
23:19unstable and you're going through hyperrowth, it's really hard to do line expansion. And I think this is what you saw as say Open AI. They're going through hyperrowth. They've had trouble expanding. It's like trying to do too many things at once.
23:30What do you make of that? Do you think that they're going to come through this moment?
23:33100%. I think almost every founder has made the mistake that I made, which is you have this initial success. You you feel like you did this amazing thing and now you can do anything. I remember a teacher once told me, Brian, you can do everything you want in your life, just not at the same time. And I think founders need to be told this. VCs who are essentially your first board members. I think they probably need to dissuade founders from pursuing too many things at the same time. You know, an investor is a portfolio manager. They
24:03want to make as many bets as possible and their only like constraint is capital or the number of boards they can sit on. And so like why not make more bets? We might miss something. When you're an operator, every incremental thing you do can, if you're not ready and you haven't mastered the prior thing, take away time, resources, and focus from the prior thing you were doing.
24:23Are you describing what Sam Alman's gone through? I mean, as as someone who's investing in companies and operating companies, and do you feel like he's un understands that transition?
24:30I think he's now learned that and I think, you know, as a friend of Sam, I hate to speak for him. I hope I'm not putting words in his mouth. I think he would say that they were really really focused and they tried to do a lot of things and they're now focused again. And I think that focus is probably why they're uh doing better than they were a year ago.
24:45Earlier you listed off a bunch of things that you're not. You know, I don't believe in this. I don't believe in that. Often companies are defined as much by what they are as what they're not. And I think Airbnb as it grew up, at least to me as a consumer, was we're not hotels. That's what we're not. You don't want the hotel experience, go to Airbnb. Now you can get a hotel and Airbnb. What went through the process of of of including them?
25:04This is a great question. I was ideologically against hotels. In fact, I think our first tag gun was forget hotels.
25:09Exactly. Exactly. Airban and breakfast.
25:11Forget hotels. We are not like your dad's like way of traveling, your mom's way of traveling. We're a new generation. We're about homes and it's cool and we're in communities and it's cheaper and hotels are expensive and they're homogeneous and they're standardized. So, why would I ever offer them? And so, that was my party line for probably 10 years. In 2018, 2019, my stubbornness got the best of me. And many of our customers told us, "We want hotels." And ultimately, I had to make a decision. You know, if you're a brand, just because your customer wants
25:40something doesn't mean you sell it to them. You can decide no, go somewhere else. This is all we do. This is the only thing we're in business of. But we noticed there were three types of people. There are people that only book Airbnbs. There are people that only book hotels, but most people are willing to book both. And we now have an ad campaign or we were running it and it says some trips are better in Airbnb.
25:58What we realized as opposed to all trips, all trips. And what we realize if you're booking last minute, if you are um staying for one night, if you kind of want a plugandplay experience or if Airbnbs are limited like in New York City or if you're traveling for business, you need to be on prem for the conference or you need like a lot of services we don't have them, a hotel may be the superior option. That wasn't how I travel by the way. My ideology and my stubbornness, you know, probably went on
26:26too long and I ultimately had to listen to customers. Founders can be stubborn.
26:30They can be like ideological. And I think that confidence and that conviction can be great, but it can create blind spots. Like Henry Ford famously thought the Model T was the last car and there should never be anything after the model Ford. So he was a revolutionary entrepreneur, but he got really really stubborn. I think that is something like there's a shadow to founders. Our conviction has a shadow and that shadow can be stubbornness and that stubbornness can get the best of us. And so we have to be willing to grow and learn. You're describing a core
26:58tension of your business or maybe any business. You talk about how Airbnb should follow the customer and you talk about how you should offer the customer things that they don't yet know that they want. How do you know when to choose one or the other?
27:11That's such a good question and I guess it's a judgment call. It's probably not easy to explain. In other words, it's taste and judgment about what your brand stands for. I think we used to think we were in the business of providing homes for travelers and at some point we had to ask ourselves, are we really in that business? Were we in some larger business? Take hotels aside. Should we offer services, show off your experiences? We decided ultimately we're in the business not just of people staying in a house cuz you don't go somewhere to sleep. You go somewhere to have an experience of travel. We started realizing why can't we offer more of the
27:41trip? Why can't we offer services? Why can't we offer experiences? And then we started realizing we're going to offer these one-of-a-kind experiences, but sometimes people just want ticket to the Louv that's a commodity. Should we say no to commodities? He said no. Maybe we should allow someone to be able to get a ticket to Lou. Well, they get to Lou, why can't they also get a hotel? You start to have this like tension point.
27:59And what we ultimately realize is we're not against offering commodities, but our brand stands for one of a kind. We ultimately want to have selection. We want to make sure that people come to Airbnb, they feel like they can live in a local community, get a local experience. We're always going to be predisposed to that. We're always going to be homes forward in our strategy, but if people want something else, we're going to be able to try to offer it to them. And that's kind of the practical way that we've tried to square what our brand stands for with making sure that people can come to us, they can trust, they can get a full travel solution to
28:30So, you're building your own AI frontier lab.
28:33Why not build that Airbnb and and what will be the relationship between the two?
28:37I thought about building inside of Airbnb. A couple things. I like to think that like our shareholders know what they get themselves into. And I never sold them on us being a frontier company and spending billions and billions of dollars of capital expenditure and then spending huge sums recruiting these engineers or these AI researchers. A, that's not the deal I have with investors. They feel like they're investing different kind of business. B, it's not in our DNA. We have not done that for 19 years. We are a technology company in the sense that um we use
29:06state-of-the-art technology, but we're not selling technology or developing state technology. And C, it's so risky and so unknown, but the benefit to Airbnb and to me is I'm going to learn a lot about AI, but it's also a totally different kind of culture. So, I wanted to keep them separate.
29:22Last time you and I talked, OpenAI was running a bunch of travel ads. And one of the questions I had for you and I had for you today is why do you think that Airbnb is going to benefit from AI faster than the AI companies are going to turn into great consumer companies that are going to offer everyone the travel experiences that you offer today?
29:38There was a saying at Netflix apparently early on we have to become HBO faster and HBO comes us and there was a race and Netflix became HBO creating original content faster and HBO became Netflix.
29:49So why why isn't open athropic going to do that to you? Ultimately, it comes down to maybe where we started, focus. You know, I think OpenAI tried to go into this. They announced third party apps. I talked to Sam about it and advised him a little bit on the development of it. And I said, if you're going to do it, you have to build a software developer kit. I think they didn't build a software developer kit.
30:08And if they want to dismediate us, they got to do all the things we're doing. They have to recruit hosts. They got to negotiate laws and cities. They've got to like focus on travel discovery.
30:17Additionally, you have verified identity. It's map focus. It's too complicated for these companies to to move into, you're saying?
30:23Yes, they can do it. They could totally do it, but they got to focus on it. And that focus would come a cost of competing with Enthropic on coding.
30:31Speaking of focus, you are moving Airbnb and you have in the past and you are today into becoming a player in policy debates. Yeah.
30:39And one of the things you're thinking about is what role this company can play when it comes to housing. Yes.
30:43So, I'm curious what is happening today and what role you think Airbnb can can play in the housing debate. I think the headline is we want to be a solution to the problem, not the problem. We have affordability crisis in America. The root of the affordability crisis is probably housing affordability. It's the number one expense people have. And Airbnb has been pointed to over the last 15 years, especially over the last decade for reasons why cities are expensive. And so the first thing we did is cities said, "Well, you're not paying hotel tax." So we started paying hotel
31:11oxy tax. We now paid more than $13 billion hotel tax. Then they said, "Well, people are taking housing off the market." And some people were. And we said, "Well, that's not good." So, we started working with cities to establish restrictions. And in San Francisco, I think people were allowed to rent like 90 days a year. San Francisco decided people probably wouldn't take their house off the market to only rent it 90 days a year. So, they decided that was a cap. We comply with that cap. In New York, we tried to come up with a similar solution. New York ultimately banned Airbnb. I think 92 or 94% of listings are are not there. I think banning
31:40Airbnb in New York was probably one of the worst things New York City has done for certainly for travel and maybe for housing because I think the last time I checked since Airb was banned, rents are up 15%, hotel prices are up 18%. Ultimately, I think New York City lost more than Airbnb and now you're so mad at New York City. You're opening an office there.
32:00I I still love New York City and I'm not mad at New York City. The vast majority of people in New York would be supportive of Airbnb in some limited way being in the city. Now, they don't want their apartments turned into hotels. They don't want unlimited use of Airbnb.
32:12But most people in New York would be supportive of some Airbnb use, especially the fact that we could probably generate more than $und00 million of tax revenue every year and we could allow people to stay in their homes. And by the way, it always represented less than 1% of our revenue, but was highly symbolic. I hope we get back into New York, but it's not up to us. It's up to the city of New York.
32:31But now you want to play a bigger role in the housing debate.
32:34I want to play a bigger role in the solution, not in the debate. And it seems like the problem in New York City is not Airbnb. It can't still be Airbnb.
32:42We're not there. So, it seems like the problem in New York is that they're not building enough housing. I'm not a housing expert, but one of the things we did late last year, early this year, is we set a team and we said, "We're going to focus on this as an issue. So, we're going to meet with housing policy adviserss." The first thing they told us shocked me. They said, "We build fewer houses today in the year 1950 with twice the population. We are 5 million homes short in the United States, the amount of homes we need. That's the equivalent of number of households in New York City and Los Angeles. So, if we want to make cities more affordable, we should build more housing. So, we want to encourage
33:12people to build more housing. So, we're going to do three things. The first thing we want to do is we're creating a $250 million fund to house last dollar for projects. There's about 750,000 homes, development projects in America that are stalled because they don't have the last dollar of completion. They're stalled because the ROI is good, but it's not investment grade ROI. And so what we're doing is we're putting $250 million into it and we think it's going to lock the con of $5 billion of housing. Now this will not even come close to solving the housing
33:42affordability crisis. We certainly aren't big enough to do that, but we hope this provides inspiration for others in America to be able to participate. The second thing is we want to do city index. We want to open source data around city's policies, the cost of living, the permitting to basically show the cities that are most successful at lowering housing costs by having the best policies. And we think, hey, we're really good at like housing. We know a lot about data. No one else is building this, so we can open source this data.
34:08And the third thing, we want to do a million-dollar prize every year for 5 years for any company, private or nonprofit, that has ideas around technology that can make housing development easier. You know, the way we build houses is almost exactly the same as 100 years ago. They have not been industrialized. So, these are the three things I think we could do in America that I've learned from housing experts.
34:28fund the last dollar to get these 750,000 homes unblocked, make it easier to build housing, and then make it a little bit more of an industrialized process.
34:36So, we're asking every CEO on the CEO moment to participate in our leadership test. I'm going to ask you a series of quick questions. Please tell me the first thing that comes to mind. What's the best summer job you ever had?
34:47I was a ice hockey counselor at a summer camp.
34:50What's the phrase you use most often?
34:54How many direct reports do you have?
34:56I think eight, but I think of all the directs and my drexs as do [clears throat] that line to me. So, I think of as like 30 or 40.
35:03How much do you sleep each night?
35:05Around seven hours. Um, for 18 years it was really, really bad and I wasn't really sleeping. And then last year I really decided to get serious and seven seven and a half hours.
35:14How many minutes is your commute?
35:18Have you ever been fired?
35:22What did your coffee order?
35:23Uh, black. How many meetings a day do you have on a normal day?
35:28Probably half a dozen.
35:30What is a book on leadership that you recommend?
35:32The hard thing about hard things of Ben Horowitz is a pretty good one. He's a good mentor of mine.
35:36What's the one question you ask in every job interview?
35:40Tell me something that you think is true about the world that everyone in your life disagrees with you about.
35:46When did you last change your mind?
35:48I think like a couple hours ago in a meeting. Brian Chesy, thank you very much for joining us on the CEO moment and having us here at Airbnb.
35:55Thank you very much.
